What is a fair hourly rate to pay a programmer? Of course the answer can depend on several well-understood aspects of the programmer:

Location (city & country)

Years of experience

Type of experience

Individual contractor or team member

Communication ability

Then again YOUR answer will also depend on your experience hiring programmers either locally or globally. Sometimes clients come to us experienced with neither and/or a directive to hire the cheapest programmers, or to comply with a threadbare budget.

Consequently I have discussions about pricing and trade-offs with our clients and prospects every week. Here’s a summary of how these conversations go, in a straight-forward, man-on-the-street version.

In general, hiring programmers, and especially a programming team, falls in the realm of “you get what you pay for” just like when buying a car, house, medical services or just about anything! Of course you can negotiate, but a nicer car, house, service, etc. will cost more than one that is less reliable, attractive, efficient and cheaper.

Since the start of 2012, we’ve had about 50 clients sign on with Accelerance Partners. And about 60% have gone nearshore at higher rates on average than other parts of the world. It’s not that they’re fiscally irresponsible or plain nuts. In fact, most of them have already been through one or more iterations of “pricing tunnel vision.” Even though their goals started out with things like quality, dependability, talent, low turnover, faster time to market, etc… in the end, they blindly accepted all of a service firm’s blanket, but unverified “yeses.” They succumbed to the promise of $19/hr seniors programmers, like so many do, in order to please the CxO and look like a hero (but alas, only for a few weeks).

Then a couple months down the road it all blew up in their faces. The CxOs forgot about the initial victory. Change orders were rampant. The senior work is actually being done by freshers or juniors (unbeknownst to the client) with seniors showing up for calls. There’s more rework than new work. The imagined prospect of promotion now looks like an imminent firing unless changes are made fast, which is impossible of course because your software development engagement isn’t a speed boat….it’s now the Titanic.

I’d say at least 50% of our calls are a variation of this: “I’ve been burned bad by chasing a solution that was too good, and priced too low to be true, and I’m willing… nay–I demand to pay more to make sure I’m getting delivery and commitment on the objectives that are most important in the end.”

So ask yourself, how do companies with (real) dedicated resources, with (real) skills, (real) high hiring standards, training and retention programs, (real) business continuity plans, (real) certifications, (real) documented best practices and all the other qualities you want, pay for this? It’s not by charging $19 or whatever low price for it. It’s not like you are the lucky client who the service provider has decided to take a loss for in order to have a referenceable case study (though I’ve heard that one). If the price is too low, you’re either dealing with bait-and-switch unethical liars, or a firm with a leg in the grave who is willing to close the deal at whatever price and then recoup the margin via other means.

Of course, saving money is often a key objective. But for the sacrifice of what? Quality? Time? Work-Life balance? Low Maintenance? Confidence? Trust? (Your job?) Of course not. Our mission is to help you get great results with your software development using a programming team that is optimized to fit all of your requirements not just cost.